About Payment Methods

PayPal allows you to make payments using a variety of methods including: PayPal balance, a bank account, PayPal Credit, debit or credit cards, and rewards balance. Because your protection against undelivered or defective goods will vary with each method, you should review this page to understand how you can select a payment method and how protection differs depending on your payment method.

This page does not address unauthorized transactions. For information on your protection against unauthorized transactions, please see the Error Resolution section of the PayPal User Agreement.

Selecting a preferred payment method

You can choose any of the payment methods in your PayPal account as your preferred payment method in the Payments section of your account settings. If you select a preferred payment method, it will be shown as the preferred payment method when you make a purchase online, in-store, or when you send money via goods and services.

You can select different preferred payment methods for online transactions and in-store transactions.

If you choose an in-store preferred payment method and do not have any money in your PayPal balance, your preferred payment method will be used for your entire purchase. If you have money in your PayPal balance, your PayPal balance will be used first, and your preferred payment method will be used for any remaining amount due.

If no preferred payment method, it’s still your choice

There may be times when your preferred payment method cannot be used. For example, if you select a credit card as your preferred payment method and the card has expired, you will not be able to pay with that card. Also, the availability of certain payment methods may be limited based on a particular seller or the third-party website you are using to complete the transaction.

If you have not selected a preferred payment method, or your preferred payment method is unavailable, we will show you available payment methods, including the payment method you use most often or most recently, at the time of transaction. You can also click on the “Manage” link to see all of your available payment methods, or add a new one, and select a payment method during the transaction.

Sending money to Friends and Family

When you send money in the U.S. to Friends and Family using your PayPal balance or your bank account, we waive all fees, so we always show you these payment options first, even if you have a set a preferred payment method for your online purchases. You always have the choice to select any payment method in your account by clicking the “Change” link on the Send Money page. If you select a payment method with a fee, we will always show you the fee before you send money.

Preapproved Payments / Automatic Payments

Some sellers allow you to store PayPal as the payment method to use whenever making purchases on their site. Often, this entails creating an agreement with the seller, where you give the seller permission to pay using your PayPal account every time you make a purchase.

When you first set up an agreement, your preferred payment method (if you have one selected) will be shown first. We will also show you other payment methods you have available in your PayPal account. For example, you can instruct your monthly movie subscription service to always charge a specific credit card in your PayPal wallet each month. The payment method you select will be used for every future transaction with that seller, unless you change it in your account settings or the payment method is unavailable.

If you choose a preferred payment method, and do not have any money in your PayPal balance, your preferred payment method will be used for the entire payment to the seller. If you have money in your PayPal balance, your balance will be used first, and your preferred payment method will be used for any remaining amount due.

If your chosen payment method is unavailable (e.g., a credit card expired), or if your agreement with the seller did not provide for the ability to specify a payment method, the payment method used will be in the following order (if available): 1. PayPal balance; 2. bank account; 3. PayPal co-branded debit card; 4. PayPal co-branded credit card; 5. debit card; and 6. credit card.

If you have PayPal Credit, it will only be used if you choose it as your preferred payment method. If you have money in your PayPal balance, your balance will be used first, and then PayPal Credit will be used for any remaining amount due.

Pay with Rewards

PayPal may allow you to redeem rewards associated with your eligible card(s) when making a purchase with your PayPal account through PayPal’s Pay with Rewards program. For example, rewards may include points, miles, or cash back, as well as other reward types.

All Pay with Rewards redemptions are subject to the terms of your card agreement and applicable reward program with your card issuer. Pay with Rewards is only available for eligible purchases with certain merchants, and PayPal or your issuer may limit, suspend, or terminate your ability to redeem rewards at any time, in accordance with the PayPal User Agreement and your card agreement and reward program terms.

Your issuer determines the value of rewards redeemed through PayPal and available redemption methods (e.g., to pay for your purchase or for a statement credit). In order to receive reward balance information from your issuer, PayPal and your issuer (or our service providers) will share information about your accounts with each other. If you have reward balance that can be redeemed through PayPal, you will see an option to use those rewards when you check out through PayPal.

There may be a delay between checkout and processing of your payment. Only rewards available upon processing of your payment will be used. If your available reward balance changes during or after the checkout process, you may not see all your available rewards or may see rewards that are no longer available. Note, depending on the type of your purchase, your merchant may not process your payment until after a period of time after you check out. If your available reward balance changes or becomes unavailable before your payment is processed, or if you modify your final checkout purchase amount, at PayPal's and your issuer’s discretion, your transaction may fail, a lesser amount of rewards may be used, or no rewards may be used. Because your reward balance and/or transaction amount may change, whenever you request to redeem rewards for a purchase, you also authorize PayPal to charge up to the full payment amount to your associated card if that happens.

Cancellations and refunds are subject to your merchant’s cancellation and refund policy. PayPal may cancel your transaction as outlined in the PayPal User Agreement. If your transaction is cancelled or you return your purchase, your refund will be processed back as a dollar amount; depending on your card agreement and reward program terms with your issuer, your issuer may or may not credit your purchase back to your reward balance. If you split your payment between your reward balance and another payment method, PayPal and/or your issuer will choose the order and split of funds when processing a cancellation or refund.

You should follow PayPal’s normal dispute resolution process for any purchase made with rewards. Each card issuer may treat chargebacks for purchases involving rewards redemption differently, please check with your card issuer for more information.

If your card information changes (including if it is reissued with a new account number), you may need to update your PayPal wallet and re-enroll your card to continue using rewards.

Payment Method Rights and Remedies

PayPal Purchase Protection

PayPal Purchase Protection (also known as PayPal Buyer Protection) applies for certain, qualifying purchases regardless of the payment method. For these qualifying purchases, PayPal will cover you for the full amount of the item plus original shipping costs if you do not receive the item or if you receive an item but it is significantly different than the description the seller provided. To receive reimbursement for items that are significantly not as described, you will be required to return the item to the seller, or in some cases to PayPal, and to pay the return shipping costs. PayPal Purchase Protection is not available for personal payments and other ineligible purchases.

To be eligible for PayPal Purchase Protection, you must file a Dispute in the PayPal Resolution Center within 180 days of the date you sent the payment, escalate the Dispute to a Claim within 20 days of the date you filed the Dispute, and meet the eligibility criteria as listed in the PayPal User Agreement.

PayPal Credit Protection

PayPal Credit offers protection against unauthorized transactions and billing errors, including items not received and items received that are significantly not as described. When you submit a PayPal Purchase Protection dispute on a transaction funded by PayPal Credit, the transaction will be placed in dispute on your PayPal Credit Account. This means you will not be responsible to repay the disputed transaction amount while the dispute is investigated and interest and fees will not be assessed while we review your dispute. This step will occur automatically when you use the dispute process in the PayPal Resolution Center.

If your dispute involves a transaction that is not identified in the Resolution Center or your dispute involves a billing error that is not related to a specific transaction, you can call PayPal Credit at 1-866-528-3733 to submit your dispute.

If you wish, you may also choose to submit any billing error dispute in writing to

    • PayPal Credit Dispute,
    • PO Box 5018,
    • Timonium, MD 21094
Credit Card Protection

You may pursue a Dispute/Claim with PayPal, or you may contact your credit card company and file a chargeback. You may not pursue both at the same time or seek a double recovery. If you have an open Dispute or Claim with PayPal, and also file a chargeback with your credit card company, PayPal will close your Dispute or Claim, and you will have to rely solely on your chargeback rights.

If you pursue a Claim with PayPal and if you do not receive a full recovery, you can then file a chargeback.

Credit card companies must abide by these statutory guidelines, including but not limited to the following:

  • If a consumer claims a "billing error" because an item is not received or is refused at the time of delivery, the card issuer is obliged to investigate, resolve, and to correct written claims filed by the consumer within 60 days of receipt of the applicable credit card statement.
  • If a consumer claims a dispute with a merchant, the card issuer is obliged to investigate and resolve consumer claims, provided the consumer: (i) has not paid for the charge (ii) has made a good faith attempt to settle the dispute with the merchant (iii) lives in the same state as or within 100 miles of the merchant and (iv) paid more than $50 for the item.

You should contact your credit card issuer to learn more about your rights and remedies.

Debit Card Protection

Your debit card issuer is not required by law to provide you with protection against items that you do not receive or that are significantly not as described. Many debit card issuers voluntarily provide protection similar to the chargeback rights provided by credit card issuers.

PayPal may process debit card transactions through either (a) an ATM debit network such as STAR or NYCE, or (b) a Visa or MasterCard network. If we process your debit card through an ATM debit network, we may provide you with the opportunity to switch to a Visa or MasterCard network by clicking the "Funding Sources" link on the payment confirmation page. Choosing the Visa / MasterCard network may give you additional protection compared to the ATM debit networks. You should contact your debit card issuer to learn more about your rights and remedies if you pay with your debit card.

Bank Account Protection

Your bank is not required by law to provide you with protection against items that you pay for with a bank transfer but that you do not receive or that are significantly not as described. You should contact your bank to determine if they voluntarily provide any purchase protection.